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HomeMy WebLinkAbout1988-06-13 249 MINUTES OF THE MEETING OF THE CITY COMMISSION BOZEMAN, MONT ANA June 13, 1988 ************************ The Commission of the City of Bozeman met in regular session in the Commission Room, Municipal Building, June 13, 1988, at 2:00 p.m. Present were Mayor Stiff, Commissioner Hawks, I Commissioner Vant Hull, Commissioner Martel, Commissioner Goehrung, City Manager Wysocki, City Attorney Becker and Clerk of the Commission Sullivan. The meeting was opened with the Pledge of Allegiance and a moment of silence. None of the Commissioners requested that any of the Consent I tems be removed for dis- cussion. Minutes It was moved by Commissioner Hawks, seconded by Commissioner Vant Hull, that the min- utes of the regular meeting of June 6, 1988 be approved as amended. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Hawks, Commissioner Vant Hull, Commissioner Martel, Commissioner Goehrung and Mayor Stiff; those voting No, none. Ordinance No. 1259 - adopting the National Electrical Code, 1987 Edition City Manager Wysocki presented Ordinance No. 1259, as prepared by the City Attorney, entitled: ORDINANCE NO. 1259 AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA, AMENDING ORDINANCE 1084, SECTIONS 1 AND 8, AS CODIFIED RESPECTIVELY AS SECTIONS 15.08.010 AND 15.08.100 OF THE BOZEMAN MUNI- CIPAL CODE PROVIDING FOR THE ADOPTION OF THE 1987 EDITION OF THE NATIONAL ELECTRICAL CODE AS MODIFIED BY THE STATE OF MONTANA AND SUPPLEMENTAL LOCAL WIRING RULES. I The City Manager reminded the Commission that this Ordinance was provisionally adopted on May 31,1988. He then recommended that it be finally adopted at this time. It was moved by Commissioner Vant Hull, seconded by Commission Martel, that the Com- mission finally adopt Ordinance No. 1259, adopting National Electrical Code, 1987 Edition, as modified by the State of Montana and supplemental local wiring rules. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Vant Hull, Commissioner Com- missioner Martel, Commissioner Goehrung, Commissioner Hawks and Mayor Stiff; those voting No, none. Ordinance No. 1261 - Amending the Bozeman Area Flood Plain Regulations as adopted by Ordi- nance No. 1237 City Manager Wysocki presented Ordinance No. 1261, as prepared by the City Attorney, entitled: ORDINANCE NO. 1261 AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA, AMENDING THE BOZEMAN AREA FLOOD PLAIN REGULATIONS AS ADOPTED BY ORDINANCE NO. 1237. The City Manager recommended that the Commission provisionally adopt this ordinance and that it be brought back in two weeks for final adoption. City Attorney Becker stated that the federal government has advised the staff that the map referenced in Ordinance No. 1237 is no longer in effect; and reference must now be made to I the July 15, 1988 map of the flood plain. He noted that the language inserted in this ordinance has been dictated by the federal government, to meet their regulations. He noted the ordinance is to be in effect by July 15; however, it will not yet be in effect as of that date. Commissioner Martel asked why the City should adopt this Ordinance before the date of the map, expressing concern that the Commissioners have not yet seen it. The City Attorney indicated that the map is the same as the one which was preliminarily adopted in October 1986. He noted that the existing ordinance refers to the map which was dated March 15, 1982. 06-13-88 250 Commissioner Martel stated he does not see the urgency to adopt this Ordinance; there- fore, he will not support its adoption. City Manager Wysocki indicated that map is available for review; and it is the map from which the City is currently working. It was moved by Commissioner Goehrung, seconded by Commissioner Hawks, that the Commission provisionally adopt Ordinance No. 1261, amending the Bozeman Area Flood Plain Reg- ulations as adopted by Ordinance No. 1237. The motion carried by the following Aye and No I vote: those voting Aye being Commissioner Goehrung, Commissioner Hawks, Commissioner Vant Hull and Mayor Stiff; those voting No being Commissioner Martel. Commission Resolution No. 2698 - certifyin delin uent semi-annual assessments as of Ma 31 , 1988 to the ounty City Manager Wysocki presented Commission Resolution No. 2698, as reviewed by the City Attorney, entitled: COMMISSION RESOLUTION NO. 2698 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA, DECLARING SEMI-ANNUAL SPECIAL ASSESSMENT INSTALLMENTS DUE AND PAYABLE MAY 31, 1988, AND UNPAID AS OF THAT DATE, DELINQUENT, PURSUANT TO SECTION 7~12-4183, MONTANA CODE ANNOTATED, AND AS PROVIDED BY CHAPTERS 2.32 AND 3.04 OF THE BOZEMAN MUNICIPAL CODE, AND DIRECTING THE DIRECTOR OF FINANCE TO CERTIFY THE SAME TO THE GALLATIN COUNTY TREASURER FOR COLLECTION. The City Manager reminded the Commission that this is a routine process, certifying all delinquent assessments to the Gallatin County Treasurer for collection. He then recommended that the Commission adopt this resolution. Mayor Stiff expressed concern that a vast majority of the delinquencies listed are under corporate names. He then asked if individual owners' names should be used. City Attorney Becker stated that corporations may own property; and the delinquencies must be certified in the names of the owners of record. Mayor Stiff noted that when Delaney and Company purchased land from Valley Unit Cor- I poration, Mr. Delaney indicated they did so without accepting the del inquent special assess- ments. He then asked if the Commission needs to take another step to protect the City. The City Attorney indicated that transfers have been made without the delinquent assess- ments being brought current or paid in full. He noted if those transfers have not complied with any agreements previously entered into, action may be possible but not through this process. He then stated that former City Attorney Bob Planalp has been responsible for handling this matter; and he is aware of the transfers. Commissioner Goehrung asked what process is followed after delinquencies are certified to the County. Administrative Services Director Gamradt stated that in July, after delinquencies are certified to the County, the County Treasurer offers those properties for tax sale. He noted that no action is taken until after eighteen months have elapsed on undeveloped property and thirty-six months have elapsed on developed property. He noted that is the redemption period; and after that time has expired, the City or County may sell the property at a percentage of the appraised value, as stipulated by State Statute. The Administrative Services Director then stated that the redemption period for Valley Unit Corporation will expire in January 1989, since it went to tax sale in July 1987. Commissioner Hawks suggested the Commission should possibly request an update on this matter from former City Attorney Planalp; and the Commission concurred. It was moved by Commissioner Hawks, seconded by Commissioner Vant Hull, that the Commission adopt Commission Resolution No. 2698, certifying delinquent semi-annual special as- I sessments as of May 31, 1988, to the Gallatin County Treasurer. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Hawks, Commissioner Vant Hull, Commissioner Martel, Commissioner Goehrung and Mayor Stiff; those voting No, none. Mayor Stiff requested that an update from former City Attorney Bob Planalp be placed on the agenda as soon as possible. 06-13-88 251 Commission Resolution No. 2699 - authorizin sale of bonds for Special Improvement District No. 653 - paving of Graf Street to collector standards - 211 ,000 City Manager Wysocki presented Commission Resolution No. 2699, as reviewed by the City Attorney, entitled: COMMISSION RESOLUTION NO. 2699 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, I MONTANA, RELATING TO SPECIAL IMPROVEMENT DISTRICT NO. 653; AUTHOR- IZING AND PROVIDING FOR THE ISSUANCE AND SALE OF SPECIAL IMPROVE- MENT DISTRICT NO. 653 BONDS, IN THE AMOUNT OF $211 ,000 FOR THE PUR- POSE OF FINANCING THE ENGINEERING DESIGN, CONSTRUCTION, INSPECTION AND ENGINEERING CERTIFICATION OF ASPHALT PAVING, CURB AND GUTTER AND SIDEWALK ON A PORTION OF GRAF STREET AND ALL OTHER NECESSARY APPURTENANCES TO COLLECTOR STANDARDS. The City Manager noted that a draft copy of this resolution was placed in the Commis- sioners' packets; and the final version was distributed just prior to the meeting. He reminded the Commissioners that one of the stipulations for proceeding with the district as created was that the Spring Meadows Partnership pay up front those assessments attributable to the City's parkland on behalf of Mr. Henry Gardiner and the MsU Foundation, in an approximate amount of $4,800. He noted that the payment is to be made at a specified critical step; and he feels that prior to the issuance of bonds and award of the construction bid would be an appropriate time. Commissioner Goehrung asked if any costs would be incurred if the developer decided not to make the payment by the stipulated time. The City Manager stated that advertising costs will be incurred and bond counsel costs may be incurred; however, those costs may be assessed against the district. Mayor Stiff asked if issuance of registered bonds with semi-annual interest payments is in the best interests of the City. Administrative Services Director Gamradt stated he feels it is. He then indicated that the State Statutes have changed in recent legislative sessions to require that such bonds be issued. It was moved by Commissioner Vant Hul I, seconded by Commissioner Martel, that the Com- I mission adopt Commission Resolution No. 2699, authorizing the sale of bonds for Special Improve- ment District No. 653. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Vant Hull, Commissioner Martel, Commissioner Goehrung, Commissioner Hawks and Mayor Stiff; those voting No, none. - Annexation A reement for Tracts 23 and 24 of the Gordon ubdivision (north of Grif in Drive and west of the Burlin ton City Manager Wysocki submitted to the Commission a letter from J. Robert Planalp, attor- ney representing Pacific Hide and Fur. He reminded the Commission that at last week's meeting, the staff was directed to prepare the Annexation Agreement. He noted that ownership of the subject property is to be transferred from Dale L. and Adolphena O. Thornton to Pacific Hide and Fur this week, contingent upon the City's assurance that the annexation is to be completed. He then recommended that the Commission authorize him to sign the Annexation Agreement and accompanying documents, contingent upon their execution of the documents. He indicated that the Resolution of annexation will be forthcoming at next week's meeting if the Annexation Agree- ment is completed this week. It was moved by Commissioner Martel, seconded by Commissioner Goehrung, that the Corn~ mission authorize the City Manager to sign the Annexation Agreement and accompanying docu- ments with Pacific Hide and Fur, contingent upon completion of the land transfer; and further direct the staff to prepare a resolution of annexation. The motion carried by the following Aye I and No vote: those voting Aye being Commissioner Martel, Commissioner Goehrung, Commis- sioner Hawks, Commissioner Vant Hull and Mayor Stiff; those voting No, none. Staff report re process for request for proposals City Manager Wysocki indicated this item has been placed on the agenda at the Com- mission's request. Director of Public Service Dick Holmes reviewed the process followed, noting that the Commissioners received copies of Sections 18-8-201 through 18-8-212, Montana Code Annotated, 06-13-88 252 in their packets. He noted that proposals for engineering services are requested whenever nec- essary, with those requests being published in the newspaper. He indicated that a review com- mittee of three to four people is established, with the composition depending on the expertise needed for review of the proposals. He noted that the committee is usually comprised of City staff members; however, review of proposals for the North 19th Avenue interchange location study included a member from the State Department of Highways. The Director of Public Service stated that enough copies of each proposal are requested I so that each committee member has one to review. He noted the proposals are reviewed individ- ually, with each person marking his ranking sheet. He indicated the committee then meets and discusses the merits and deficiencies in each proposal. Through this process, the committee comes to a consensus of the firm which should be selected; and that firm is notified. The Director of Public Service stated that the cost of the proposal is then discussed; the scope of the work to be performed is final ized; and, if those steps are successfully completed, the con- tract for engineering services is prepared. Commissioner Hawks stated that he has heard two separate concerns expressed with the current policy: (1) There does not appear to be any public record of the ranking criteria used; and it does not appear that the firms submitting proposals have access to how they were rated and why; and (2) There is no public representative on the review committee. He then asked if those concerns could be addressed. The Director of Public Service stated he does not feel that firms should be given any in- formation other than the request for proposals prior to the deadline for submittal. He noted that after the proposals have been rated, those submitting proposals often contact the committee members individually. I n response to a question from Commissioner Hawks, Mr. Holmes indicated he is not sure of the ramifications that could occur as a result of taping the committee meetings. City Manager Wysocki asked if the process followed for selection of an engineering firm for the North 19th Avenue interchange location study was based on the State Highway Depart- ment's process; and Mr. Holmes indicated it was very similar. I City Manager Wysocki then asked Commissioner Hawks what he means by a public repre- sentative. The Commissioner responded that a City Commissioner or contractor in a related field could serve. He noted that to have someone from outside the local government can create a sense of openness in the community. He then indicated that the individual could be appointed simply to serve as an observer, and not an active member of the committee. Commissioner Vant Hull expressed interest in Commissioner Hawks' proposal. She cited the Audit Committee as an example of appointing citizen members to a board to address a problem situation. Mayor Stiff indicated that citizen members helped that committee when it was first formed; however, he stated he does not feel that is a parallel situation. Commissioner Vant Hull noted that the State Law basically indicates that the best qualified firm must be hired; however, there does not seem to be a definition for "best qualified. II She then suggested that the staff be asked to investigate the possibility of including someone from outside the staff, submitting a list of advantages and disadvantages back to the Commission. Commissioner Martel noted that the State Statute indicates that the City is to "... select, based on criteria established under agency procedures and guidelines and the law, the firm con- sidered most qualified to provide the services required for the proposed project. II He noted, however, that the City has not established any procedures and guidelines to be followed in all situations, but customized procedures and guidelines are followed for each proposal. He then indicated that he feels a specific set of procedures and guidel ines should be developed; and they should be made available to the public. I Commissioner Goehrung asked if the same committee is used to review proposals or if the membership varies. Director of Public Service Dick Holmes stated that the membership varies, depending on the type of project and expertise needed. Commissioner Goehrung then asked if there are times that the expertise needed is not available on the City staff. City Manager Wysocki indicated that in some instances outside expertise is necessary, citing the interchange location study as an example. 06-13-88 253 Commissioner Goehrung then asked if firms would be able to see the evaluation sheets after the selection process has been completed. The City Manager indicated that representatives from a firm would be able to see that firm's summary sheet; however, they could not see anyone else's. He noted that a committee member could also discuss with them the strengths and weak- nesses of their proposal. Director of Public Service Holmes stated that a variety of proposals are received in res- I ponse to each request for proposals. He noted that some firms may submit a brief letter stating their interest while others may submit a very finite and detailed proposal, including a descrip- tion of potential problems and possible solutions. Mayor Stiff asked if the selection files are permanent in-house files. Mr. Holmes indi- cated the City Engineer retains them for a period of time after the project has been completed. The Mayor then asked if the qualifications of the personnel to be assigned to the project are to be submitted in a common format. The Director of Public Service indicated that resumes are requested, with a listing of work completed. Mayor Stiff noted that a weighted evaluation form is prepared for each proposal. He then asked if that has worked adequately. The Di rector of Public Service indicated that through the weighted evaluation form, pre- ference is given to local firms. He noted that if a firm has a local office but proposes to use personnel from another office, it is not given full credit for a local office. Mr. Holmes then stated that each member of the committee chooses the top three firms; then the committee as a whole selects the top three. He noted those firms are informed that they have been "short listed; II and the remaining firms are notified that they did not make the short list. He indicated that he does not feel the firms need to know anything beyond that. Commissioner Hawks stated that during current economic times, engineering firms are at- tempting to sharpen their proposal writing skills to be more successful; and they desire infor- mation on their rankings toward that end. He then indicated he feels the City needs to make the selection process better and more open. He also stated a more standard selection process I and guidelines could raise the comfort level of those submitting proposals. Commissioner Martel stated support for Commissioner Hawks' comments. City Manager Wysocki stated that each person will complete a ranking form differently. He noted it does not matter if the marks given by an individual are low, as long as the firms are ranked in the desired priority. Commissioner Martel stated he feels the evaluation forms should be made available to the public. City Attorney Becker reminded the Commission that under the Constitution, the publ ic has the right to know; and most meetings must be open to the public. He also noted, however, that not all of the documents are necessarily open to the public. Commissioner Hawks stated he feels it is important for the City to take an extra step to increase confidence in the City's operation. He then asked how this could be best accomplished. City Manager Wysocki stated the staff needs to know the type of comments to which the Commission is responding and what they want. He asked if the Commission is interested in hav- ing another person on the selection committee; or if a general pol icy is desired. Mayor Stiff suggested that an ad hoc committee of Commissioners could be formed to con- sider this item and submit suggestions back to the Commission. He also noted the staff could be asked to seek information from other Cities on how they handle this process. City Attorney Becker stated the City is not a training ground on how to write proposals. The Mayor then noted there is no large engineering firm centrally located in Bozeman. The City Manager reminded the Commission that a few weeks ago, Commissioner Martel in- I dicated that if he could walk into an office in Bozeman, then the firm has a local office. He noted that none of the Commissioners opposed that definition. Commissioner Goehrung stated his primary concern is the City's liability in selecting a proposal. He also indicated interest in selecting two Commissioners to work with the City Manager and staff on gathering information from other communities. He noted that a proposed policy could then be prepared and submitted back to the Commission for consideration. 06-13-88 254 B rea k - 3: 1 8 to 3: 23 p. m . Mayor Stiff declared a break from 3:18 p.m. to 3:23 p.m., in accordance with Commission policy established at their regular meeting of March 14, 1983. Staff report re process for request for proposals (continued) Mayor Stiff indicated that during break he discussed the proposal to form an ad hoc com- mittee with the City Attorney and various Commissioners. He then indicated that Commissioner I Martel and Commissioner Goehrung have indicated a wi IIingness to serve on that type of commit- tee. It was moved by Commissioner Hawks, seconded by Commissioner Vant Hull, that Commis- sioner Martel and Commissioner Goehrung be appointed to serve on a sub-committee to review the City's contracted services pol icies and standards for architectural, engineering and land sur- veying services, with a report to be submitted back to the Commission. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Hawks, Commissioner Vant Hull, Commissioner Martel, Commissioner Goehrung and Mayor Stiff; those voting No, none. Discussion ~ status of Sewer Fund Discussion - status of Garbage Fund City Manager Wysocki submitted to the Commission a memo from Administrative Services Director Miral Gamradt concerning the financial status of all three enterprise funds--water, sewer and garbage. Administrative Services Director Gamradt reviewed the memo as submitted to the Commis- sion, noting that it has raised several questions without giving many answers. He then indicat- ed that one of the auditors' comments in the Management Letter was that the City should estab- lish a policy on reserves for the Enterprise Funds, and asked the Commission to address that issue as a result of this discussion. He then requested that the Commission address the fol- lowing questions, as contained in the memo: 1. What is a good pol icy from a financial management point of view? Should I the City have the financial capability to replace worn-out equipment or should it borrow? 2. What is a good pol icy from an equity point of view? Should users be covering debt service only if there is bonded indebtedness (such as in the Water Fund), or partially cover costs of replacement if there is no bonded indebtedness (such as in the Sewer Fund and Garbage Fund)? The Administrative Services Director then submitted the following policy issues for Com- mission consideration, as conta ined in the memo: 1. Current rate payers should pay for major capital items either through debt service payments or through funding of depreciation for asset replacement. 2. The City should have the ability to replace minor capital items without in- curring debt. 3. Current rate payers should not be required to pay for future major capital items; but those costs should be funded through issuance of bonds over the life of the asset. 4. Utility rates should enable the City to maintain a contingency reserve, pos- sibly at 15 percent of the annual expenditure level, or possibly within a 10 to 25 percent range. Administrative Services Director Gamradt noted that once a policy has been established, the staff can then evaluate the cash status of each fund in relation to what is desirable. He indicated this could also be beneficial in determining if a rate change is necessary. The Administrative Services Director stated that the staff has been researching the issue of reserve levels for the past two and one-half years, including asking the auditors, accounting I professionals and other communities, as well as reading literature; and there are no definitive answers. He noted that in funds, such as the Garbage Fund, where the City is largely depen- dent on one large user, a higher reserve may be better; while those funds with a more consis- tent income may be adequately served with a lower reserve. Administrative Services Director stated that the policy adopted by the Commission will not result in an immediate change in rates. It will, however, serve as a barometer for future mon- itoring of the funds and their balances. 06-13-88 255 Commissioner Hawks asked, from a financial point of view, whether it is more cost effec- tive to generate adequate monies through the rates to pay cash for major improvements or if it is more cost effective to borrow the monies to do so. The Administrative Services Director stated that from a financial point of view, paying cash is more cost effective. He noted, however, that from an equity standpoint, such a practice may result in one group paying for an improvement while another group receives the benefits. I Mr. Gamradt then stated that the Waste Water Treatment Plant was mostly funded through a federal grant, with the remainder being funded through cash within the Sewer Fund. He in- dicated that the City should recover the costs of the plant plus inflation to cover the costs of replacing the facility when it is fully depreciated to be in an ideal position. He noted, however, that is not practical, since that would result in approximately $16 million in reserves. He then suggested that the City should fund an amount adequate to cover the downpayment for expansion or replacement, with the remainder of the monies to be covered through bonded indebtedness. Commissioner Hawks asked if interest income would help offset the inflation factor. The Administrative Services Director indicated that it would; and it would definitely be taken into consideration in setting the rates. Commissioner Vant Hull noted that the Waste Water Treatment Plant, which was mainly paid for through a federal grant, is much different from the Water Treatment Plant, which was covered through a bond issue. She then indicated that she feels that those paying sewer user fees could be asked to fund depreciation expenses since there is no debt service to be paid. Commissioner Martel noted that the Waste Water Treatment Plant doesn't fit the normal situation, since federal monies were used. He then indicated that the equipment in the plant wi II need replacing long before the plant needs replacement. He also noted that the plant should have some salvage value left when it is fully depreciated. City Manager Wysocki reminded the Commission that the sewer collection system is also a part of the assets; and it also needs consideration. He noted that portion of the system has been basically untouched for many years and will require some maintenance or replacement. I Commissioner Martel suggested that repair and maintenance of sewer collection lines should be ongoing and, as such, should be funded through the operations portion of the budget. Mr. Gamradt suggested that as major replacement of I ines is made, debt shou Id be incur- red so that those benefiting from the service also bear the costs. He concurred that usual re- pairs and maintenance should be covered under the operations budget. Commissioner Goehrung noted that the rates need to cover the costs of operation, repair and replacement of equipment, and costs of improving major assets. He then asked if there are any other costs to be considered in the enterprise funds. The Administrative Services Director indicated those are the costs to be covered. Mayor Stiff asked if the revenues to cover bond debt service and the bond covenants are the same or two separate items. Mr. Gamradt indicated that the bond covenants for the Water Bond Revenue Bonds require that 125 percent of the highest bond payment be generated annual- ly to guarantee sufficient monies to cover the debt. The Mayor then noted that in the Water Fund, the City could consider, as well as having a designated reserve for the bond covenants and a payroll reserve that are already in place, a contingency reserve for operations and some provision for asset replacement. He also noted that under the proposed reserve policy, replacement and purchase of small capital items might not be funded and rolling stock possibly could be fully funded while large fixed assets would be mostly acquired through future debt. Administrative Services Director Gamradt reminded the Commission that a large portion of the water distribution and sewer collection lines have been installed through special improvement I districts; therefore, the City has not incurred those costs. He said the City presently incurs annual repair and maintenance costs for these lines; however t he said major replacement of lines should be funded through the issuance of debt--a topic which could be debated. The Administrative Services Director then distributed to the Commission copies of financial summaries for the three enterprise funds, covering Fiscal Years 1983, 1984, 1985, 1986 and 1987. He stated that depreciation expense has been included only recently in the operations budgets to reflect actual costs of doing business. He noted that during Fiscal Year 1987, the financial statements for the Sewer Fund show a $580,000 loss but the fund actually has a positive cash flow. 06-13-88 256 The Administrative Services Director then reviewed the manner in which the summaries were prepared. He noted that working capital is the current assets minus current liabilities. In the Water Fund, this number includes the loan from the General Fund to the Water Fund. He indicated that the water rates have been adjusted so that the fund is now headed in the right direction, although progress may be slower than desired. He then stated an interest in estab- lishing a contingency reserve at 15 percent of operating expenses less depreciation. He a I so suggested that small capital items be depreciated to 125 percent of original cost to cover the I costs of inflation. Admin istrative Services Di rector Gamradt stated that in the Sewer Fund, depreciation of the plant is based on that portion which was funded through the federal grant. Mr. Gamradt then reviewed the summary of the Garbage Fund. He noted this is the healthiest of the three enterprise funds. Commissioner Goehrung noted that the garbage service currently does not cost a large amount of money because of the landfill's close proximity to the city limits; and federal regula- tions have not added substantially to the costs. He then asked if the City should begin to set aside monies for replacement of the landfill so that the costs to users do not jump dramatically. Mayor Stiff indicated that he feels where the land is being used for landfill purposes, the value of the land is actually decreasing. He then stated support for Commissioner Goehrung's comment, suggesting that the land should possibly be amortized to provide a downpayment for future replacement. Mayor Stiff then stated it should not be necessary to fully fund the amount for asset re- placement, since interest income on the funded balance will cover a portion of those needed funds at replacement time. Administrative Services Director Gamradt indicated this item was placed on the agenda to initiate discussion on establishing a policy for reserves. He then indicated the staff will prepare a pol icy statement for each fund, based on Commissioner input, for consideration. Mayor Stiff asked if the designated reserves for the General Fund are to be included in the policy statements. I The Administrative Services Director stated that all of the reserves will be included. He indicated that all of those reserves will be reviewed separately, since the newly elected Com- missioners have not been through that process. City Manager Wysocki asked the superintendents involved in the sewer and garbage funds to list some of the capital items that need to be considered in the near future. Water and Sewer Superintendent Fred Shields briefly reviewed items which need to be ad- dressed within the next few years. He noted that approximately 40 percent of the sewer collec- tion system is clay tile line, which has a life expectancy of twenty to thirty years. He stated that the City ceased to install that type of pipe approximately twenty years ago; therefore, some type of replacement program should be initiated. He noted that cleaning of the lines, which is done once a year, and maintenance due to tree routes all serve to shorten the life span of those lines. Mr. Shields then stated that approximately 3/4 mile of 21-inch sewer trunk line is in need of repair because it is badly cracked. He indicated that it should be televisioned; however, so much is running through the line that a camera cannot be lowered into it. He stated some lines are flat; and others have been installed at an improper grade. He then indicated that several of the lines should be televisioned to determine how much repair or replacement is required. Mr. Shields then addressed the lift stations. He noted that engineering is currently be- ing done on one of the lift stations. The other lift station is beginning to require "nickel and dime" repairs; and within the next ten years, a complete replacement will be necessary. Fred Shields stated that several of the manholes have deteriorated. He noted that some of the materials have been purchased for that repair; however, he does not have the manpower I or equipment to complete the repairs. Commissioner Vant Hull suggested that a sewer rate increase could provide monies to hire additional personnel to complete some of the necessary repairs. Mr. Shields indicated that some of the replacement may need to be contracted out because the City is not equipped to undertake large replacement projects. Waste Water Treatment Plant Superintendent Don Noyes stated that to repair the sewer collection lines will reduce flow to the plant, which will increase its ability to accept more 06-13-88 257 customers. He reminded the Commission that the IP beds are in need of repair; and the City has just received a 100 percent grant from EPA to cover those costs. Mr. Noyes stated that the sludge holding ponds are too small; and that is one of the first areas which must be addressed at the plant. He also noted that a liner used in the system did not seal, allowing sludge to seep under the liner. He stated they have found methane gas under the liner; however, it has not yet contaminated the groundwater. He indicated that those beds I must be reconstructed or repaired in the near future; or an alternative would be to install a de- watering system. The Waste Water Treatment Plant Superintendent stated that in five to eight years, the Big A injector truck will need replacing, at a current estimated cost of $146,000. He then briefly reviewed capital items which will be needed during the upcoming year, which include a new Lowe pump to use in addition to the pumps currently used. He noted that the existing pumps do not efficiently move the sludge; and the new Lowe pump would. Monitoring equipment of various types, including an oscilloscope, are other capital purchases to be considered in the upcoming year. Mr. Noyes then stated that the engineering estimate is for a 25-year plant life expectancy without expansion. He noted that after the sludge beds have been adequately addressed, life expectancy could be even longer. Street and Sanitation Superintendent Roger Sicz noted that several subdivisions within the city limits have petitioned for City garbage collection over the years. He noted the Commission must make a determination on two pending petitions--one from Valley Unit and one from Hyalite. If the determination is made to add those areas to the City collection system, another truck and at least two men to work two or three days a week must also be added. He indicated that the additional revenues from those areas should cover the additional costs incurred, based on the current rate structure. The Street and Sanitation Superintendent stated that the crews pick up all of the addi- tional garbage in an alley clean-up program each spring; and he suggested that an additional $10 I per house be established to cover those costs. He noted that the extra garbage takes up space in the landfill; and those monies could be set aside for replacement of the landfill site, by whatever method is determined appropriate. He indicated that the life expectancy of the landfill is currently estimated at eight to ten years. Mr. Sicz stated that two caterpillars operate at the landfill at all times. He noted one of those is owned by the City and one is leased. He then suggested that the City may wish to consider terminating the lease on the one Cat and purchase one with a larger dump bucket. He noted that, although Three Rivers Disposal has stopped hauling trash to the landfill, several of the mobile home courts have started hauling their own garbage to the landfill. He then reminded the Commission that the landfill rates have not been changed since 1984, and suggested that they should possibly be reviewed. Director of Public Service Holmes suggested that after the new scales have been installed at the landfill, they be used for a couple months to gain historic data before any change in the rate schedule is considered. Commissioner Vant Hull suggested that an in-city and out-of-city rate schedule be estab- lished, so that the out-of-city residents can also participate in the costs of a new garbage dis- posal system. Commissioner Hawks asked if operator efficiency at the landfill could be improved. Street and Sanitation Superintendent Roger sicz stated that two operators are usually on duty at all times. He noted that efficiency could possibly be improved; however, he needs to observe the process for a while before considering any changes. I Discussion - FYI Items City Manager Wysocki presented to the Commission the following IIFor Your I nformationll items. ( 1 ) Minutes from the Board of Adjustment meeting of June 6, 1988. (2) Copies of letters from Ray Johnson concerning flood water in his crawl space, as requested by Commissioner Martel. Commissioner Martel stated that Mr. Johnson had contacted him about this problem. He 06-13-88 258 noted that Mr. Johnson had water in his crawl space following the rain about a month ago as well as with the last rain. City Manager Wysocki indicated that Mr. Johnson has discussed this matter with various City staff members over the past several years. Commissioner Vant Hull stated that she has also discussed this issue with Mr. Johnson. (3) The City Manager reminded the Commission that the Audit Committee wi II meet at 11 :00 a.m. on Friday, June 17. I (4) The City Manager reminded the Commissioners of the CNFR Parade at 2: 30 p. m. on Wednesday, with lunch at the Elks at 12:30 p.m. (5) Commissioner Vant Hull indicated that she will attend a Board of Directors meeting for the League on Friday in Helena. She suggested that any Commissioner wishing messages con- veyed to that meeting contact her before Friday morning. Commissioner Martel suggested that a representative from the Gaming Industry Association of Montana be invited to address the League at its annual convention in September. He noted that Mr. Jim Durkin, Executive Director, indicated an interest in being invited to address the League when he appeared before the Commission recently. (6 ) Commissioner Goehrung indicated appreciation for the sidewalk marking which in- dicated no bicycles or skateboards are allowed on the sidewalks in the downtown area. He noted they have greatly reduced the number of offenders. Consent Items City Manager Wysocki presented to the Commission the following Consent Items: Request for one-year extension of preliminary plat for Spring Meadows Subdivision, to June 1, 1989 Authorize Call for Bids for construction of SI D No. 653 - paving of Graf Street to collector standards Application for Kennel License - Deborah L. Berglund and Monte L. Cooper, 803 South Church Avenue - Calendar Year 1988 Claims It was moved by Commissioner Vant Hull, seconded by Commissioner Martel, that the Con- I sent Items be approved as listed above, and the appropriate persons be authorized and directed to complete the necessary actions. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Vant Hull, Commissioner Martel, Commissioner Goehrung, Commis- sioner Hawks and Mayor Stiff; those voting No, none. Adjournment - 5:34 p.m. There being no further business to come before the Commission at this time, it was moved by Commissioner Martel, seconded by Commissioner Goehrung, that the meeting be adjourned. The motion carried by the following Aye and No vote: those voting Aye being Commissioner Martel, Commissioner Goehrung, Commissioner Hawks, Commissioner Vant Hull and Mayor Stiff; those voting No, none. ALFRED M. STIFF, Mayor ATTEST: ROBIN L. SULLIVAN I Clerk of the Commission 06-13-88